The labour force participation rate in the US has fallen dramatically since 2007. This column traces this decline to three main factors: the ageing of the population, cyclical effects from the Great Recession, and an unexplained portion, which might be due to pre-existing trends unrelated to the first two. Of these three, the ageing of the population plays the largest role since it is responsible for half of the decline. Taken together, these factors suggest a roughly stable participation rate in the short-term, followed by a longer-term decline as the baby boomers continue to age. However, policy can play a
meaningful role in mitigating this trend.

The UK is about to make a massive change to its pension system. From October 2012, employers will be obliged to automatically enrol employees into a pension scheme – though individuals can opt-out. This column explores what this might mean for pension funding and argues that the risks are to the downside.

It is a daunting reality for many advanced economies that even if they manage to cut public spending today, they will continue to have huge liabilities as their populations age. This column argues that healthcare reform, no matter how politically unpalatable, will have to be a part of countries’ financial adjustment plans.

As if the current debt problems for industrialised economies were not enough, many face the added challenge of ageing populations. This column argues that the biggest threat from an ageing population is the lack of cover for long-term care.

Western countries with ageing populations are in the grip a cruel irony. At the same time as having more old people than ever to support, youth unemployment is at its highest levels for a generation. As many of these countries go into elections this year, this column warns against populist politics that panders to the grey vote, and instead calls for leadership that puts the family first.

The impending retirement of the baby-boom cohort represents the first time in the history of the US that such a large and well-educated group of workers will exit the labour force. Despite the gloomy outlook of recent research, this column suggests there is little likelihood of large-scale skill shortages emerging by the end of this decade.

Fiscal pressure from demographic changes is mounting across the globe. This column asks whether labour markets will create enough jobs. Cross-country comparisons suggest that, until at least 2050, the countries most under pressure will be Poland, Turkey, and Greece.

Should developed countries raise their retirement ages to combat the economic effects of their ageing populations? This column presents a model suggesting that, viewed in isolation, putting off retirement will actually reduce growth. It is only when viewed along with other policies that the benefits for growth arise.

Over the last half century, life expectancy in the industrialised world has risen dramatically – and so has the healthcare bill. Is population ageing the main reason? This column argues that while ageing does affect health spending, it is far less important than many think. It adds that obsession with an ageing population is a dangerous red herring that prevents dealing with the real culprits of rising costs.

Ageing populations are a concern for many developed countries, with increasing dependence on the working population expected. Despite this, there is relatively little research on how productivity changes with age. This column argues that while older people do not run as fast, there is no evidence of a mental productivity decline and little evidence of an increasing pay-productivity gap. The negative effects of ageing on productivity should not be exaggerated.